Chat with Kenny

Hi SI users,

Thanks for your questions posted over the past week. I am happy to answer your questions online. I will repost the questions in blue italics followed by my comments in black.

Kenny the Fish

Jayster, you wrote:

Hi Kenny,

Congrats on the improved results.

Noted your export of dragon fish has included China and the Middle East. Are there any plans to go into Vietnam and India, 2 of Asia's fastest growing economies? Which country are you most bullish in terms of profit growth for Qian Hu?

Hi Jayster,

I would like to thank you for the kind words.

We are consistently monitoring the markets in India and Vietnam. Sales in these two markets has been increasing in a slow and steady rate. We might also invest in these two countries in the future if the following conditions are met:

1. We have the right people to take care of the business internally
2. We have the right partner in those countries externally.

Regards.

Kenny the Fish

Serene Lim, you wrote:

Has Qian Hu benefitted from the building of the 2 IR resorts in Singapore? Has it been awarded any contracts to supply fishes and accessories equipment?

Hi Serene,

Ponds and fish features might be incorporated in the Intergrated Resorts' design. However, the revenue will not be significant as our group's market is global.

Regards.

Kenny the Fish

David Lum, you wrote:

Your acquisition of the 20% stake in Arcadia Products PLC looks strategic for Qian Hu to enter the EU markets and moving the production facilities to China will reduce cost of manufacturing the plastic accessories.

But given the recent bad press of China manufactured products being of inferior quality, would it damage the Arcadia brand?

Hi David,

To be pragmatic about the "Made in China" issue, the world can't live without China products with the country often being cited as "The Factory to the World".

Global sports equipment brand, Nike manufactures its product in developing countries like China but yet it did not encounter any image problem in its branding. I believe that the problem isn't where you make the products, but how make it.

With our experienced management team in Singapore, United Kingdom's proven Research and Development capabillities and lower cost of labour from China, Qian Hu can achieve equally good quality products with lower cost. With these in mind, I am not worried about the issue.

Regards.

Kenny the Fish

Gerald Toh, you wrote:

I've noticed that Qian Hu has begun to realise the importances of branding and R&D to retain margins and customer royalty.

Which aspect of the Qian Hu brand do you think make customers want to buy your product?

What breakthru in R&D efforts has Qian Hu achieved currently?

Hi Gerald,

People like us because we are consistent in maintaining the quality of our products. We are able to provide our customers with a wide selection and variety of fish and fish accessories. We also provide prompt and quality customer service.

We have made some achievements in our "Dragon Fish" Research and Development collaboration with Temasek Life Sciences Laboratory. Our partner will release the findings in due course.

Regards.

Kenny the Fish

Lim Toh Kim, you wrote:

Does Qian Hu makes fish feed and medical supplies? I can't find any on your website. Does Qian Hu intend to go into these areas given the potential recurring income?

Hi Toh Kim,

Yes, we do have a wide selection of fish food and medication. Besides being agents for a few brands, Qian Hu own a local brand call "OCEAN FREE". Please feel free to visit any aquarium stores in Singapore and you will find "OCEAN FREE" products displayed prominently in the store's shelves. I'm proud to say "OCEAN FREE" is the Number 1. brand for aquarium accessories in Singapore!

Regards.

Kenny the Fish

Richard Tan, you wrote:

Hi Kenny,

With the acquisition of a 20 percent stake in UK-based Arcadia Products PLC, what does the European market for ornamental fish look like for the next 3-5 years?


Hi Richard,

Qian Hu is currently the major supplier of ornamental fish in Europe. We supply the EU from our base in Singapore, Malaysia, Thailand and China. We have yet to supply accessories to Europe.

I hope in the next three to five years, we will be able to supply both fish and accessories to all the European countries with the help of Arcadia's distribution network and our prior experience in expanding in Asia.

Regards.

Kenny the Fish

Thanks again to all the investors who have posted their questions here. I hope I have answered them to your satisfaction. The next chance for us to correspond again will be the time when we announce our First Half Year 2007 results. In the meantime, do feel free to visit our corporate website: http://www.qianhu.com/ and our IR website: http://qianhu.listedcompany.com for more information.

Take care and I look forward to our next online Q&A.

Have a nice day!

Kenny the Fish